We do our own bookkeeping (using QuickBooks). We also do state and city taxes, payroll and related forms 940, 941, W3 and W2 as well as forms 1096/1099 ourselves.
We use the accountant for Form 1120S (US Income Tax Return for an S Corporation).
At the end of the year I give our accountant an electronic copy of the data and go over the numbers in a meeting and she prepares the form.
If there are any questions or issues during the year she bills us hourly.
I do not think it makes sense for a startup to pay a retainer fee to an accountant, I think the best structure is to pay them for year end taxes and per hour throughout the year.
Number 1 lesson I have learned over my career in startups - if you are a founder or head of operation (that is what I do for a living), do books as much as you can yourself. Number 1a lesson - as a founder, don't delegate signing checks to anyone until you are 200-300 employee company.
Approach I have taken before was to run the books myself and at least every quarter have a CPA audit your books. Once the company is large enough to have a full-time bookkeeper, than I would still look over every morning transactions from the day before.
I strongly believe you loose control of your business the moment you loose clear sight of your books.
My accountant is related to me, so my situation is a little different. I keep the books myself, and send them over for review about once a quarter. At the end of the year, I send a copy of the full year's books (for personal, that's hard copy, for business, soft copy from QUickBooks) and then sit down and run through it together.
In general, though, you want to have someone review your books while you still remember the details. There's nothing so annoying as looking at a 12-month-old receipt and trying to figure out what exactly it was for because it doesn't match what's on the books.
If you're bootstrapped, I would think doing your own taxes and finances with the aid of some basic software should be the option you choose.
If you are involved in complex or continuous transactions or with multiple employees and payrolls that are hard to track an accountant might be of use.
Generally, you should never rely completely on an accountant to manage your finances. They should be a person who just crosses Ts and dots Is to make sure the IRS doesn't come after you, while you should always have clear macro/micro view of your numbers.
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